THE FAR-LEFTISM OF AUSTRALIA'S PUBLIC BROADCASTERS
The following is a letter recently sent by one of my readers to to General Karl Eikenberry US Army Central Command Iraq and Afghanistan
"I would like make you aware that there are two Australian television and radio broadcasters, the ABC and SBS with embedded correspondents in Iraq and Afghanistan who are sending extremely strong anti American propaganda back to Australia. In the case of the ABC, which is now broadcasting into some forty countries in SE Asia, Osama bin Laden and associates could not have a more effective propaganda machine in this region, no matter how much money they paid. Amazingly both these broadcaster are funded by the Australian government which these broadcasters despise.
These broadcasters, staffed by extreme Leftists have a blantant agenda to divide the Australian and regional peoples from America's efforts to win the war on terrorism. Their focus is targeted at any US and coalition setbacks, harm done to civilians, and especially any stories related to torture.in US military prison camps, including Guantanomo.
In fact the ABC ran 57 stories on Iraqi prisoner abuse alone, yet only one on the world's biggest scam featuring the Left's favourite institution, the UN and it's oil for food program, which as you are aware, enabled Saddam to buy weapons that have been, and still are being used to kill coalition forces in Iraq. I have never seen a single program by these broadcasters showing the US in a good light. Even their three stories on Hurricane Katrina were nothing more than hysterical rants against the US Government, and yet, this is the ABC, SBS idea of "balanced reporting".
The fact that the ABC, SBS hate America , hate Australia propaganda is now being broadcast into a region that is home to over 230 million Muslims should concern us all. "A *review of these two broadcasters programs since the start of the war in Afghanistan would certainly prove that these broadcasters are not just biased against the governments of Australia, Britain, Israel and the US, but they are sending a very clear message of sympathy and support for the terrorists cause.
For the good of America's image and the war effort, and the morale of Australian troops in the field, and their countrymen back home, I believe it is imperative that these two broadcasters be denied access to any US military operations. In fact they (along with the British BBC) should be banned completely from all areas of conflict, both in Iraq and Afghanistan, as they are doing much harm in dividing Australians from the coalition, not to mention the harm done in the SE Asia region where these programs are viewed.
Even putting Australians and Americans at more risk will not even deter these broadcasters in their appointed mission of sowing the seeds of dissent amongst fellow Australians, and giving more cause to potential regional or at home terrorists. Those who will one day be willing to strap on a bomb because of the stories of the perceived Muslim abuse that he has seen or heard on all those programs paid for, courtesy of the Australian taxpayer.
There is absolutely no benefit in allowing these broadcasters any more ammunition to smear the US military at every possible opportunity, and believe me, this is something in which they excel.
How the Australian government can allow these two broadcasters carte blanche, in what they broadcast in a time of war ( while picking up the tab) is amazingly short-sighted and dangerous. Hopefully the new anti terror laws will apply to what is nothing less than sedition and the vilification of our principal ally, the United States.
* For a review of the stories broadcast on SBS, read here"
My reader goes on to add:
Doesn't it occur to anyone in the government that it's not very smart to be broadcasting, (as in the case of the ABC) anti American, anti Australian government stories of Muslim abuse into 40 countries in SE Asia where there are some 230 million Muslims?
We are at war and the ABC should immediately have strict wartime censorship controls imposed on the programs that have stories related to the war or coalition countries. These stories must be reduced to a reasonable number per week, and actually have merit and balance. No more hatchet jobs. And they must pass a review of non ABC staff, say three citizens from the Right and three from the Centre Left...No Red Ratbags. As the coalition now has the power in the senate, we must now end what is no less than fifth column propaganda. (or outright sedition ).
The government also has the option of say, halving the budget of the ABC. There will be those who will scream bloody murder, but those who do will be the ones that hate the government anyway.
While spending some $700 million per year on the ABC to denigrate and demonise Australia and the United States throughout the region, further putting Australians and Americans at risk, might seem like a good idea to some, to me ,it's the most absurd thing I have ever heard. And for the good of all Australians and our coalition partner, the United States, the government must show some gumption and end this absurd state of affairs where a leftist minority is painting the face of Australians and Americans throughout the region as if we are the enemy.
Last Wednesday night on SBS Dateline,the presenters were actually boasting that the filming of US troops using the burn bodies of Taliban to lure them out, were broadcast around the world. The fact that the journalists embedded with the trusting US troops have put these soldiers and their countrymen at even more risk seems to be of no concern... Just one more notch in the belt for the agents of "Hate America"
And guess what Dateline has in store for us this coming Wednesday?.."Olivia Rouset talks with Iraqi torture victims from Abu Ghraib prison." You gotta hand it to these Leftists. When they set out to accomplish something, such as trying to smear America they give it their all, no matter what the consequences are for all Westerners.
I believe it is essential that all of us who believe in the Australian/US alliance contact Senator Chris Ellison Attorney Generals office Senator.Ellison@aph.gov.au and Communications Minister Senator Helen Coonan at senator.coonan@aph.gov.au. and register our complaint, as these broadcaster will continue to divide our country and place all Australians and Americans at an ever increasing risk.
Sunday, October 23, 2005
MELANESIANS AND THE EVOLUTION OF CIVILIZATION
A little while back, I put up a post about Melanesians (and the people of New Guinea in particular) that speculated on why Melanesians seem pretty bright despite their having been in the Stone Age within living memory. A reader has offered the following interesting observations on the factors which may have affected their evolution and the evolution of civilization in general:
"As usual you've written something that is both interesting and correct, but which requires elaboration. In particular the the reasons for Papuan technobackwardness, which also relates to Ireland, Tasmania, the Cape Province, and Tierra del Fuego.
Back as an undergrad I took courses from one Charlie Nelson, an Africanist, at UMASS/Boston (where one of my classmates was a Papuan student, by the way, and a very good one. I hope he didn't have to become some government bureaucrat.) One day were were discussing the development of agriculture, a necessity for any even low tech society, and Nelson commented that the earliest civilizations were found in areas which were on trade routes. Mesopotamia is the perfect example, being along rivers that link the highlands of Anatolia with Mohenjo-Daro and India, with the highlands of Iran (the source of what) to the North East and Egypt way off to the far west beyond the Levant. Mesopotamia was able to take advantage of the resources from all those areas in building a stable, year supply base (chickens from Thailand via India, Copper from Anatolia, etc.) and so had the world's first true urban centers.
A similar situation existed in various parts of the New World, where the Valley of Mexico's nascent civilizations had access to materials from the highlands and lowlands (the Olmecs began in swamps, by the way, along the Gulf of Mexico -- they gave birth to the basic structures for both Mayans and Nahuatl speakers (who have totally different languages.) Civilization was held back by a lack of domesticable animals (the bison cannot be domesticated. Alas. And the paleoindians ate the last of the horses.) The same is also true of South America where the resource lines in the Andes were highly vertical (to survive a village has to keep farms at many elevations.) The civilzations of early China clearly began along river courses -- and we now know there was widespread communication with the 'west,' from which they got both the chariot and the word for it ("che" is the term for car now. Also iron technology.) The Cape Province is at the end of Africa. Take a look at a map of Africa -- what does it face? Where can you get to from there? What navigable rivers does it have? The areas which faced Europe and the Levant (and the one area which had a navigable river) developed high civilizations; the rest of the continent is, in many ways, as isolated as any Papuan valley. It wasn't until around 1AD that the Bantu acquired iron and the food complex that allowed them to explode out of the Bight of Benin area (the armpit of Africa, shall we say) and head in various streams south, east, and then south again, exterminating or absorbing the native Bushmen (take a look at Nelson Mandela's face as proof of that.)
Now, the most technobackward of all cultures were those at the ends of the supply lines. Austronesia is a case in point. The native Tasmanians were as primitvie technologically as the Tierra del Fuegans. The most primitive economy in Europe was the Irish (something that predated even the Celtic invasions) and remained that way until the island became part of the Viking era trading empire. Japan is more akin to Great Britian here, with its northenmost province being the most primitive, but they were also culturally dominated by China and the ancestors of the Japanese were relatively advanced when they moved to the Island from the Korean Peninsular.
Geographic determinism is very real in a number of senses, but rather it sets limits. Both the Greeks and Papuans were constrained by mountain valleys, yet the Greeks were on the trade routes from Persia to the Baltic and had the Med to play in, the Papuans were cut off from Asia and had Australia to the south".
A little while back, I put up a post about Melanesians (and the people of New Guinea in particular) that speculated on why Melanesians seem pretty bright despite their having been in the Stone Age within living memory. A reader has offered the following interesting observations on the factors which may have affected their evolution and the evolution of civilization in general:
"As usual you've written something that is both interesting and correct, but which requires elaboration. In particular the the reasons for Papuan technobackwardness, which also relates to Ireland, Tasmania, the Cape Province, and Tierra del Fuego.
Back as an undergrad I took courses from one Charlie Nelson, an Africanist, at UMASS/Boston (where one of my classmates was a Papuan student, by the way, and a very good one. I hope he didn't have to become some government bureaucrat.) One day were were discussing the development of agriculture, a necessity for any even low tech society, and Nelson commented that the earliest civilizations were found in areas which were on trade routes. Mesopotamia is the perfect example, being along rivers that link the highlands of Anatolia with Mohenjo-Daro and India, with the highlands of Iran (the source of what) to the North East and Egypt way off to the far west beyond the Levant. Mesopotamia was able to take advantage of the resources from all those areas in building a stable, year supply base (chickens from Thailand via India, Copper from Anatolia, etc.) and so had the world's first true urban centers.
A similar situation existed in various parts of the New World, where the Valley of Mexico's nascent civilizations had access to materials from the highlands and lowlands (the Olmecs began in swamps, by the way, along the Gulf of Mexico -- they gave birth to the basic structures for both Mayans and Nahuatl speakers (who have totally different languages.) Civilization was held back by a lack of domesticable animals (the bison cannot be domesticated. Alas. And the paleoindians ate the last of the horses.) The same is also true of South America where the resource lines in the Andes were highly vertical (to survive a village has to keep farms at many elevations.) The civilzations of early China clearly began along river courses -- and we now know there was widespread communication with the 'west,' from which they got both the chariot and the word for it ("che" is the term for car now. Also iron technology.) The Cape Province is at the end of Africa. Take a look at a map of Africa -- what does it face? Where can you get to from there? What navigable rivers does it have? The areas which faced Europe and the Levant (and the one area which had a navigable river) developed high civilizations; the rest of the continent is, in many ways, as isolated as any Papuan valley. It wasn't until around 1AD that the Bantu acquired iron and the food complex that allowed them to explode out of the Bight of Benin area (the armpit of Africa, shall we say) and head in various streams south, east, and then south again, exterminating or absorbing the native Bushmen (take a look at Nelson Mandela's face as proof of that.)
Now, the most technobackward of all cultures were those at the ends of the supply lines. Austronesia is a case in point. The native Tasmanians were as primitvie technologically as the Tierra del Fuegans. The most primitive economy in Europe was the Irish (something that predated even the Celtic invasions) and remained that way until the island became part of the Viking era trading empire. Japan is more akin to Great Britian here, with its northenmost province being the most primitive, but they were also culturally dominated by China and the ancestors of the Japanese were relatively advanced when they moved to the Island from the Korean Peninsular.
Geographic determinism is very real in a number of senses, but rather it sets limits. Both the Greeks and Papuans were constrained by mountain valleys, yet the Greeks were on the trade routes from Persia to the Baltic and had the Med to play in, the Papuans were cut off from Asia and had Australia to the south".
Friday, October 21, 2005
"THE WHITE ROSE" -- MISCONSTRUING NAZI HISTORY
This letter originally appeared on Oct. 17th. in an Oregon local paper called "The World" but does not appear to be online
On October 4 on this page, Monica Schreiber recommended that opponents of the war in Iraq go see the play “The White Rose” in order to be encouraged and “raise consciousness in our community” for resistance against that war. Because anybody who stages an amateur play at the On-Broadway deserves an audience, I hope lots of people saw it. But the facts don’t support Monica’s conclusions.
The real “White Rose” was a small group of medical students in Munich who set out, in the winter of 1942/43, to distribute anti-war pamphlets calling the Nazis irresponsible gangsters and urging the Germans to practice non-violent resistance against Hitler, whose troops were then suffering their first major defeat at Stalingrad. Monica Schreiber tells us that for the White Rose students in the play, “commitment to their beliefs serves them in maintaining their position.” I don’t think that was true of the real ones, who were stupid enough to scatter their pamphlets from a balcony at the university. They were promptly arrested and tried for sedition by Judge Roland Kreisler, a fanatical Nazi whose idea of a trial was to scream invectives at the accused before condemning them to death. And since the heads of the condemned were cut off that same day, they must have had trouble maintaining their positions. You see, for non-violence to work, your opponent must have scruples.
Roland Kreisler was the same judge, by the way, who tried the Stauffenberg conspirators who tried to murder Hitler with a bomb in July 1944. They were strung up with piano wire. Soon after this, a bomb fell on Kreisler and his courtroom. Poof, bang, all gone. What neither the White Rose nor Stauffenberg could do (wipe out a patch of evil) was achieved by an American B-17.
With regard to the war in Iraq, Saddam Hussein’s refusal to allow inspections of his nuclear program supplied the reasons for our invasion, which could be called a preventive war. Now, it is a curious fact that a preventive war against Hitler during the 1930s could have prevented the slaughter of the White Rose students, about 6 million Jews, and millions of others. That window of opportunity opened in March 1936, when Hitler’s Wehrmacht invaded the Rhineland. Under the terms of the World War I armistice, that area was to remain a demilitarized zone, like the DMZ that separates North and South Korea today. Against the advice of his generals, who knew they didn’t yet have the forces to fight neighboring France, Hitler marched his troops into the Rhineland anyway. Had the French intervened – which they were legally entitled to do - they would have beaten the Germans, and that would probably have been the end of Hitler. But the French government, dominated by leftist pacifists, had decreed that the French armed forces must only be used defensively. So they talked themselves into doing nothing. Hitler’s successful bluff emboldened him to swallow Austria next, then Czecho-Slovakia, and finally Poland. And this is how World War II started: a lot of the blame can be placed on the anti-war movements of the time.
Nobody knows for sure how history will treat America’s present war in Iraq. About the wisdom of any war, a much better perspective can often be obtained ten or twenty years later. Still, it amazes me how the anti-war left can twist history into pretzels. The White Rose conspiracy was futile, and doomed from the start. It had no effect whatsoever on World War II, and it may have discouraged many other Germans from doing anything.
This letter originally appeared on Oct. 17th. in an Oregon local paper called "The World" but does not appear to be online
On October 4 on this page, Monica Schreiber recommended that opponents of the war in Iraq go see the play “The White Rose” in order to be encouraged and “raise consciousness in our community” for resistance against that war. Because anybody who stages an amateur play at the On-Broadway deserves an audience, I hope lots of people saw it. But the facts don’t support Monica’s conclusions.
The real “White Rose” was a small group of medical students in Munich who set out, in the winter of 1942/43, to distribute anti-war pamphlets calling the Nazis irresponsible gangsters and urging the Germans to practice non-violent resistance against Hitler, whose troops were then suffering their first major defeat at Stalingrad. Monica Schreiber tells us that for the White Rose students in the play, “commitment to their beliefs serves them in maintaining their position.” I don’t think that was true of the real ones, who were stupid enough to scatter their pamphlets from a balcony at the university. They were promptly arrested and tried for sedition by Judge Roland Kreisler, a fanatical Nazi whose idea of a trial was to scream invectives at the accused before condemning them to death. And since the heads of the condemned were cut off that same day, they must have had trouble maintaining their positions. You see, for non-violence to work, your opponent must have scruples.
Roland Kreisler was the same judge, by the way, who tried the Stauffenberg conspirators who tried to murder Hitler with a bomb in July 1944. They were strung up with piano wire. Soon after this, a bomb fell on Kreisler and his courtroom. Poof, bang, all gone. What neither the White Rose nor Stauffenberg could do (wipe out a patch of evil) was achieved by an American B-17.
With regard to the war in Iraq, Saddam Hussein’s refusal to allow inspections of his nuclear program supplied the reasons for our invasion, which could be called a preventive war. Now, it is a curious fact that a preventive war against Hitler during the 1930s could have prevented the slaughter of the White Rose students, about 6 million Jews, and millions of others. That window of opportunity opened in March 1936, when Hitler’s Wehrmacht invaded the Rhineland. Under the terms of the World War I armistice, that area was to remain a demilitarized zone, like the DMZ that separates North and South Korea today. Against the advice of his generals, who knew they didn’t yet have the forces to fight neighboring France, Hitler marched his troops into the Rhineland anyway. Had the French intervened – which they were legally entitled to do - they would have beaten the Germans, and that would probably have been the end of Hitler. But the French government, dominated by leftist pacifists, had decreed that the French armed forces must only be used defensively. So they talked themselves into doing nothing. Hitler’s successful bluff emboldened him to swallow Austria next, then Czecho-Slovakia, and finally Poland. And this is how World War II started: a lot of the blame can be placed on the anti-war movements of the time.
Nobody knows for sure how history will treat America’s present war in Iraq. About the wisdom of any war, a much better perspective can often be obtained ten or twenty years later. Still, it amazes me how the anti-war left can twist history into pretzels. The White Rose conspiracy was futile, and doomed from the start. It had no effect whatsoever on World War II, and it may have discouraged many other Germans from doing anything.
Wednesday, October 12, 2005
AN EMAIL FROM DR. CHRIS R. TAME OF THE LIBERTARIAN ALLIANCE ON THE DEATH OF ARTHUR SELDON
"I regret to report that Arthur Seldon died peacefully yesterday (Tuesday afternoon).
Arthur was the Founder and Director - the real intellectual fountainhead, creator and inspiration - of the Institute of Economic Affairs, which laid the intellectual and political foundations of the Thatcherite revolution in the UK. Whilst he received a CBE rather than a Lordship in recognition for his work with the Institute the true stature of his contribution was known to those close to him and to the Institute.
Unlike many other figures in the so-called movement Arthur was a genuine libertarian, idealist and a true comrade to others - motivated by more than simply desire for a huge pension or a lust for fame or control over others.
Arthur wrote and spoke for the Libertarian Alliance on various occasions, was a member of its Advisory Council, a financial donor and referred publicly repeatedly to the LA as the real successor to the IEA. He was deeply upset by the fate and inexorable decline of his beloved IEA following his retirement.
Marjorie, his wife and intellectual partner (and whose own health is not in that good a shape) does not wish to receive telephone calls. However, letters from those who knew and loved Arthur would be welcomed.
Obituaries will definitely be appearing in The Times and The Daily Telegraph (both by Lord Harris), in The Independent and elsewhere. I will try to post their texts here in LAF in due course.
Arthur will be deeply missed by not merely who knew him personally and who loved him, but by all those for whom he was an inspiration and a significant intellectual influence".
See also here
"I regret to report that Arthur Seldon died peacefully yesterday (Tuesday afternoon).
Arthur was the Founder and Director - the real intellectual fountainhead, creator and inspiration - of the Institute of Economic Affairs, which laid the intellectual and political foundations of the Thatcherite revolution in the UK. Whilst he received a CBE rather than a Lordship in recognition for his work with the Institute the true stature of his contribution was known to those close to him and to the Institute.
Unlike many other figures in the so-called movement Arthur was a genuine libertarian, idealist and a true comrade to others - motivated by more than simply desire for a huge pension or a lust for fame or control over others.
Arthur wrote and spoke for the Libertarian Alliance on various occasions, was a member of its Advisory Council, a financial donor and referred publicly repeatedly to the LA as the real successor to the IEA. He was deeply upset by the fate and inexorable decline of his beloved IEA following his retirement.
Marjorie, his wife and intellectual partner (and whose own health is not in that good a shape) does not wish to receive telephone calls. However, letters from those who knew and loved Arthur would be welcomed.
Obituaries will definitely be appearing in The Times and The Daily Telegraph (both by Lord Harris), in The Independent and elsewhere. I will try to post their texts here in LAF in due course.
Arthur will be deeply missed by not merely who knew him personally and who loved him, but by all those for whom he was an inspiration and a significant intellectual influence".
See also here
Sunday, October 02, 2005
Don't Worry About Post-Greenspan Era: Central Banking Itself Has Been Elevated
By GREG IP
Staff Reporter of THE WALL STREET JOURNAL
September 19, 2005; Page A2
This article no longer seems to be available online at its original source so I have reproduced it below
Last month, an Australian newspaper proposed a novel candidate to succeed Alan Greenspan as Federal Reserve chairman: Ian Macfarlane. Though an unknown in the U.S., Mr. Macfarlane has something no other candidate can boast: a track record that rivals Mr. Greenspan's.
Since Mr. Macfarlane became governor of the Reserve Bank of Australia nine years ago, that country's inflation rate has fallen a percentage point and its unemployment rate by three percentage points, to U.S. levels. Though buffeted by the Asian financial crisis in 1997 and a housing bubble, Australia has experienced just one quarter of negative growth.
As Mr. Greenspan's retirement approaches in January, anxious investors wonder: Can anyone reproduce his record? A glance at Australia and elsewhere suggests that the answer is yes. While the U.S.'s economic performance has been superb during the Greenspan era, it isn't unique. "Very similar results have been attained elsewhere," says Stanley Fischer, a former Citigroup executive who runs Israel's central bank.
A review of nine major countries' economic performance, based on data compiled by Global Insight Inc., an economic-consulting firm in Lexington, Mass., shows that Australia, Canada, the United Kingdom and Spain have done as well or better than the U.S. in reducing inflation and unemployment since 1987. However, only Australia and Spain have grown faster overall, and the U.S. has enjoyed the most stability -- just five quarters of negative economic growth during that period.
Whatever qualities have made the Greenspan Fed successful, many other central banks appear to share them. This means that President Bush probably doesn't have to find a Fed chairman with Mr. Greenspan's eclectic mix of smarts, intuition and rigor, to continue his success. It does mean that choosing someone outside the mold of a modern central banker is risky.
What explains central banks' widespread success? In the past two decades, central banking has become a "much more professional, technical job," says Alan Budd, who served in the British Treasury and the Bank of England during the 1990s and is provost at Oxford University's Queen's College. "It's not just a question of taking the politics out, but of putting the economics in." The Bank of England adopted inflation targets, regular policy meetings and inflation reports in 1992, which Mr. Budd says were important precursors to the bank's formal independence in 1997.
Australia, Britain and Canada adopted numerical inflation targets in the early 1990s, a step the Fed has declined to take. Debate rages among academics about their value. Rory Robertson, an economist at Macquarie Bank in Sydney, Australia, says even with a target, Mr. Macfarlane has done more or less the same things Mr. Greenspan would: "put up rates when the economy is running strongly and the labor market is tightening, and cut rates when the economy is threatened."
While Mr. Greenspan is both praised and criticized for preferring judgment to rules, "It would be hard to write down precisely what any central banker has done through this period," Mr. Budd says. So while Mr. Greenspan responded quickly to the 1987 stock-market crash and the 2001 meltdown in technology stocks, his foreign peers have been flexible in the face of the unexpected. Shortly after Mr. Macfarlane, who had been at the RBA since 1979, became governor in 1996, the Asian financial crisis pummeled Australia's export markets and its dollar. He resisted the orthodox prescription of raising interest rates to counter the dollar's drop, and Australia's economy barely skipped a beat. Similarly, in 2003 the Bank of Canada reversed a string of rate increases when outbreaks of severe acute respiratory syndrome and mad-cow disease suddenly undercut growth prospects.
Luck has also been important. While oil prices are rising, there has been no repeat of the massive shocks of 1973 and 1979 that hurt growth and elevated inflation. China's integration into the global market has put downward pressure on goods prices everywhere. In the U.S., Mr. Greenspan has benefited from a tech-fueled surge in productivity. Conversely, Germany owes its poor performance in part to the difficulties of reunification, and Japan to the aftershocks of a massive property bubble, and both suffer from stagnant population growth.
The four English-speaking countries have done particularly well. That's because their financial and labor markets are less regulated, so they are more "resilient and spontaneously self-correcting," says Jean-Philippe Cotis, chief economist at the Organization for Economic Cooperation and Development. If a worker loses his job in one industry, he is more likely to take one at a lower wage in another. Firms are more likely to cut prices and shrink capacity in the face of falling demand. This, Mr. Cotis says, makes it easier for a central bank to cut interest rates, and for those cuts to flow through to home buyers and businesses.
Other countries' good performance doesn't diminish Mr. Greenspan's achievements. Because of the U.S.'s overwhelming influence on world growth and financial markets, it is unlikely other countries could have done so well had the U.S. performed badly. As Mr. Macfarlane said earlier this year, "The major macroeconomic events that have affected Australia have to a large extent been imported rather than homegrown." And Alan Blinder, a former Fed vice chairman, says other central bankers have learned from Mr. Greenspan.
Because of the Fed's importance to their own economic stability, other countries are watching the Greenspan succession closely. Mr. Robertson says foreigners don't generally like Mr. Bush's foreign or fiscal policies but have taken comfort that "someone smart and sensible is running the Fed." Foreign investors want the next chairman to be a "straight up-and-down central banker type." The candidate who most closely fits that description, he says, is Ben Bernanke, a former Fed governor and monetary scholar who is Mr. Bush's economic adviser. Investors, he says, "know how he thinks."
By GREG IP
Staff Reporter of THE WALL STREET JOURNAL
September 19, 2005; Page A2
This article no longer seems to be available online at its original source so I have reproduced it below
Last month, an Australian newspaper proposed a novel candidate to succeed Alan Greenspan as Federal Reserve chairman: Ian Macfarlane. Though an unknown in the U.S., Mr. Macfarlane has something no other candidate can boast: a track record that rivals Mr. Greenspan's.
Since Mr. Macfarlane became governor of the Reserve Bank of Australia nine years ago, that country's inflation rate has fallen a percentage point and its unemployment rate by three percentage points, to U.S. levels. Though buffeted by the Asian financial crisis in 1997 and a housing bubble, Australia has experienced just one quarter of negative growth.
As Mr. Greenspan's retirement approaches in January, anxious investors wonder: Can anyone reproduce his record? A glance at Australia and elsewhere suggests that the answer is yes. While the U.S.'s economic performance has been superb during the Greenspan era, it isn't unique. "Very similar results have been attained elsewhere," says Stanley Fischer, a former Citigroup executive who runs Israel's central bank.
A review of nine major countries' economic performance, based on data compiled by Global Insight Inc., an economic-consulting firm in Lexington, Mass., shows that Australia, Canada, the United Kingdom and Spain have done as well or better than the U.S. in reducing inflation and unemployment since 1987. However, only Australia and Spain have grown faster overall, and the U.S. has enjoyed the most stability -- just five quarters of negative economic growth during that period.
Whatever qualities have made the Greenspan Fed successful, many other central banks appear to share them. This means that President Bush probably doesn't have to find a Fed chairman with Mr. Greenspan's eclectic mix of smarts, intuition and rigor, to continue his success. It does mean that choosing someone outside the mold of a modern central banker is risky.
What explains central banks' widespread success? In the past two decades, central banking has become a "much more professional, technical job," says Alan Budd, who served in the British Treasury and the Bank of England during the 1990s and is provost at Oxford University's Queen's College. "It's not just a question of taking the politics out, but of putting the economics in." The Bank of England adopted inflation targets, regular policy meetings and inflation reports in 1992, which Mr. Budd says were important precursors to the bank's formal independence in 1997.
Australia, Britain and Canada adopted numerical inflation targets in the early 1990s, a step the Fed has declined to take. Debate rages among academics about their value. Rory Robertson, an economist at Macquarie Bank in Sydney, Australia, says even with a target, Mr. Macfarlane has done more or less the same things Mr. Greenspan would: "put up rates when the economy is running strongly and the labor market is tightening, and cut rates when the economy is threatened."
While Mr. Greenspan is both praised and criticized for preferring judgment to rules, "It would be hard to write down precisely what any central banker has done through this period," Mr. Budd says. So while Mr. Greenspan responded quickly to the 1987 stock-market crash and the 2001 meltdown in technology stocks, his foreign peers have been flexible in the face of the unexpected. Shortly after Mr. Macfarlane, who had been at the RBA since 1979, became governor in 1996, the Asian financial crisis pummeled Australia's export markets and its dollar. He resisted the orthodox prescription of raising interest rates to counter the dollar's drop, and Australia's economy barely skipped a beat. Similarly, in 2003 the Bank of Canada reversed a string of rate increases when outbreaks of severe acute respiratory syndrome and mad-cow disease suddenly undercut growth prospects.
Luck has also been important. While oil prices are rising, there has been no repeat of the massive shocks of 1973 and 1979 that hurt growth and elevated inflation. China's integration into the global market has put downward pressure on goods prices everywhere. In the U.S., Mr. Greenspan has benefited from a tech-fueled surge in productivity. Conversely, Germany owes its poor performance in part to the difficulties of reunification, and Japan to the aftershocks of a massive property bubble, and both suffer from stagnant population growth.
The four English-speaking countries have done particularly well. That's because their financial and labor markets are less regulated, so they are more "resilient and spontaneously self-correcting," says Jean-Philippe Cotis, chief economist at the Organization for Economic Cooperation and Development. If a worker loses his job in one industry, he is more likely to take one at a lower wage in another. Firms are more likely to cut prices and shrink capacity in the face of falling demand. This, Mr. Cotis says, makes it easier for a central bank to cut interest rates, and for those cuts to flow through to home buyers and businesses.
Other countries' good performance doesn't diminish Mr. Greenspan's achievements. Because of the U.S.'s overwhelming influence on world growth and financial markets, it is unlikely other countries could have done so well had the U.S. performed badly. As Mr. Macfarlane said earlier this year, "The major macroeconomic events that have affected Australia have to a large extent been imported rather than homegrown." And Alan Blinder, a former Fed vice chairman, says other central bankers have learned from Mr. Greenspan.
Because of the Fed's importance to their own economic stability, other countries are watching the Greenspan succession closely. Mr. Robertson says foreigners don't generally like Mr. Bush's foreign or fiscal policies but have taken comfort that "someone smart and sensible is running the Fed." Foreign investors want the next chairman to be a "straight up-and-down central banker type." The candidate who most closely fits that description, he says, is Ben Bernanke, a former Fed governor and monetary scholar who is Mr. Bush's economic adviser. Investors, he says, "know how he thinks."